Huw Pill told a podcast in the United States that there is a “reluctance to accept that, yes, we are all worse off”.
He said that in response to higher bills and other rising costs, employees demanded pay rises and businesses charged higher rates, reports the BBC.
Inflation in Great Britain was 10.1% in March. Inflation is much higher than the 2% target set by the Bank of England. In response to rising prices, the Central Bank raised interest rates, making borrowing more expensive.
In theory, this measure should cause people to cut back on spending, so that the demand for goods decreases and price increases slow down. Although wages have risen, they have not kept pace with inflation, meaning people are worse off.
People have to accept that they are poorer
Pill said that people demanding wage increases and businesses raising prices contributed to inflation and caused prices to rise further throughout the economy.
“Somehow someone in the UK needs to accept that they are worse off and stop trying to maintain their real purchasing power by raising prices, either by raising wages or by passing on energy costs to customers“, declared the Beyond Unprecedented podcast from Columbia Law School.
“We are faced with this reluctance to accept that, yes, we are all worse off and we have to assume“.
“We try to transfer this cost to one of our compatriots and say:
“This game of passing the deck that is going on here, this game is one that generates inflation, and this part of inflation can persist“.
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